USA: AB InBev adds another Mexican beer to its U.S.portfolio

AB InBev (ABI) is apparently adding another Mexican import to its U.S. portfolio of imported brands. The federal Alcohol and Tobacco Tax and Trade Bureau (TTB) has approved labels of craft lager Cerveza Mexicali, which will be available in 12oz cans and bottles in the U.S. ABI acquired the brand in November 2015 through a subsidiary of Grupo Modelo and the deal included the craft breweries Cervecería Mexicana and Cervecería Tijuana.

The Cerveza Mexicali brand was launched in in 1923 in the Baja California town of Mexicali. After about 50 years, the brewery closed, but the brand was picked up by Cervercería Mexicana and brewed at its Tecate brewery.

As the market for Mexican imports continues to flourish, ABI sees the need to enlarge its Mexican beer portfolio. Last year 26.95 million hectoliters of Mexican beer were imported to the U.S. making Mexico by far the major beer exporting country, followed by the Netherlands with only 5.49 million hectoliters. Belgium, Canada and Germany take the following places.

 In June 2013, AB InBev had to sell Grupo Modelo’s U.S. distribution rights for Corona, Modelo Especial and other Mexican beer brands in a $5.3 billion deal to Constellation Brands (CB) to gain U.S. antitrust approval of its $20.1 billion merger with Grupo Modelo. This left the world beer market leader without an adequate Mexican beer to offer to the U.S. market. (inside.beer, 1.11.2016)

 As a consequence ABI introduced in March 2016  Estrella Jalisco to the U.S. market. Two years later, in April 2018, ABI announced plans to launch this spring in the U.S. Bocanegra, another Mexican craft beer brand that so far has only been sold in its home country. Bocanegra was founded in Monterrey in 2012, and was acquired by ABI as part of its Mexican shopping spree of 2015 and 2016.

While Estrella Jalisco is mainly addressing the mass-market, Bocanegra and Mexicali will most likely target more the upper segment of the beer market.

Even in a growing market segment like this, the battle for the consumer's favor will not be easy for ABI. Next to CB’s brands Corona and Modelo Especial, the major players have already positioned their respective Mexican brands.

In 2010 Heineken bought the beer activities of Fomento Económico Mexicano, S.A.B. de C.V. (FEMSA) in exchange for a 20% economic interest in Heineken, making FEMSA the second biggest shareholder in the Dutch company.  The transaction was valued $7.6 billion and brought Heineken brands like Tecate and Dos Equis which the company successfully imports to the U.S. Sol, which is also a Heineken brand, is being exclusively imported by MillerCoors. The two companies signed last year an import and distribution agreement for the next ten years. (inside.beer, 7.6.2017)

Cerveza Mexicali will be imported by St. Louis-based ABI subsidiary Import Brands Alliance, which also imports other ABI brands like Stella Artois, Hoegaarden, Leffe, Montejo, Estrella Jalisco, Camden Hells, Presidente, Birra del Borgo and L'equilibrista. Import Brands Alliance was established when AB InBev split up its High End Beer Division into a craft beer and an import beer division. Since then, the import barnds are managed by Anheuser Busch’s core sales and marketing teams under the supervision of Brendan Whitworth, the company’s vice president of sales, and Marcel Marcondes, vice president of marketing. (inside.beer, 17.7.2018)

 

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